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PACIFIC BANKING CORP vs CA FACTS: [Consolidated Case] CASE#1 (union)(5th division) 1.

Pacific Banking Corporation (PaBC) was placed under receivership by the Central Bank of the Philippines and, was placed under liquidation. a. A Liquidator was appointed. 2. RTC: the Central Bank filed a petition entitled "Petition for Assistance in the Liquidation of Pacific Banking Corporation." a. The petition was approved, after which creditors filed their claims with the court. 3. Pacific Banking Corporation Employees Organization (Union), herein petitioner, filed a complaint-in-intervention seeking payment of holiday pay, 13th month pay differential, salary increase differential, Christmas bonus, and cash equivalent of Sick Leave Benefit due its members as employees of PaBC. a. RTC ordered payment of the principal claims of the Union. 4. The Liquidator filed a Motion for Reconsideration and Clarification of the order. a. DENIED! 5. The Liquidator filed a Notice of Appeal and a Motion for Additional Time to Submit Record on Appeal. a. The respondent judge disallowed Liquidator's Notice of Appeal on the ground that it was late. (Filed more than 15 days after receipt of the decision) 6. *CA: Liquidator filed a petition for Certiorari, Prohibition and Mandamus a. CA held in the case of the Union that the proceeding before the RTC was a special proceeding and, therefore, the period for appealing from any decision or final order rendered therein is 30 days. b. Since the notice of appeal was filed on the 30th day of his receipt of the decision granting the Union's claims, the appeal was brought on time. c. RTC should give due course to the appeal. 7. *SC: The Union filed a petition a. The union contends that the case is a special proceeding and that the appeal was filed out of time. CASE #2 (stockholders/investors)(14th divison)

1. *RTC: Ang Keong Lan and E.J. Ang Int'l., private respondent, filed claims for the payment of investment in the PaBC allegedly in the form of shares of stocks amounting to US$2,531,632.18. a. Respondent judge directed the Liquidator to pay private respondents as preferred creditors. 2. The Liquidator moved for reconsideration a. DENIED! 3. The Liquidator filed a Notice of Appeal from the orders. a. As in the case of the Union, however, the judge ordered the Notice of Appeal stricken off the record on the ground that it had been filed without authority of the Central Bank and beyond 15 days. b. The judge directed the execution of his order granting the Stockholders/ Investors' claim. 4. *CA: Liquidator filed a petition for Certiorari, Prohibition and Mandamus a. CA held that a liquidation proceeding is an ordinary action. b. Therefore, the period for appealing from any decision or final order rendered is 15 days c. Since the Liquidator's appeal notice was filed on the 23rd day of his receipt of the order appealed from, deducting the period during which his motion for reconsideration was pending, the notice of appeal was filed late. 5. *SC: The Liquidator filed a petition a. Liquidator contends that the Petition for Assistance in the Liquidation of the Pacific Banking Corporation s a Special Proceeding case and/or one which allows multiple appeals, in which case the period of appeal is 30 days and not 15 days from receipt of the order/judgment appealed from. ISSUE: Whether a petition for liquidation is a special proceeding or an ordinary civil action HELD: SPECIAL PROCEEDING Rule 2 of the Rules of Court provide: 1. Action defined. Action means an ordinary suit in a court of justice, by which the party prosecutes another for the enforcement or protection of a right, or the prevention or redress of a wrong.

2. Special Proceeding Distinguished. Every other remedy, including one to establish the status or right of a party or a particular fact, shall be by special proceeding. ( I made a table para masmadali maintindihan haha joel ) ACTION (CIVIL ACTION) SPECIAL PROCEEDINGS The act by which one sues The act by which one seeks to another in a court of justice for the establish the status or right of a enforcement or protection of a party, or a particular fact. right, or the prevention or redress of a wrong. A formal demand of a right by one A petition for a declaration of a against another. status, right or fact. Proper remedy of a party litigant Proper remedy of a party whose that seeks to recover property purpose is to seek the appointment from another. of a guardian for an insane. A petition for liquidation of an insolvent corporation should be classified a special proceeding and not an ordinary action. Such petition does not seek the enforcement or protection of a right nor the prevention or redress of a wrong against a party. It does not pray for affirmative relief for injury arising from a party's wrongful act or omission nor state a cause of action that can be enforced against any person. What it seeks is merely a declaration by the trial court of the corporation's insolvency so that its creditors may be able to file their claims in the settlement of the corporation's debts and obligations. Put in another way, the petition only seeks a declaration of the corporation's debts and obligations. Put in another way, the petition only seeks a declaration of the corporation's state of insolvency and the concomitant right of creditors and the order of payment of their claims in the disposition of the corporation's assets. Since a petition for liquidation is in the nature of a special proceeding, the period of appeal is 30 days and the party appealing must, in addition to a notice of appeal, file with the trial court a record on appeal in order to perfect his appeal. In CASE#2 (Stockholders/Investors), the Liquidator's notice of appeal was filed on time, having been filed on the 23rd day of receipt of the order granting the claims of the Stockholders/Investors. However, the Liquidator did not file a record on appeal with the result that he failed to perfect his appeal . As already stated a record on appeal is

required under the Interim Rules and Guidelines in special proceedings and for cases where multiple appeals are allowed. The reason for this is that the several claims are actually separate ones and a decision or final order with respect to any claim can be appealed. Necessarily the original record on appeal must remain in the trial court where other claims may still be pending. Because of the Liquidator's failure to perfect his appeal, the order granting the claims of the Stockholders/Investors became final. In CASE#1 (union), CA correctly granted the Liquidator's Petition for Certiorari. Prohibition and Mandamus. As already noted, the Liquidator filed a notice of appeal and a motion for extension to file a record on appeal on December 10, 1991, i.e., within 30 days of his receipt of the order granting the Union's claim. Without waiting for the resolution of his motion for extension, he filed on December 20, 1991 within the extension sought a record on appeal. Respondent judge thus erred in disallowing the notice on appeal and denying the Liquidator's motion for extension to file a record on appeal. CA correctly granted the Liquidator's Petition and its decision should be affirmed. Note:
Liquidation proceedings do not resemble petitions for interpleader. For one, an action for interpleader involves claims on a subject matter against a person who has no interest therein. This is not the case in a liquidation proceeding where the Liquidator, as representative of the corporation, takes charge of its assets and liabilities for the benefit of the creditors. He is thus charged with insuring that the assets of the corporation are paid only to rightful claimants and in the order of payment provided by law. Rather, a liquidation proceeding resembles the proceeding for the settlement of state of deceased persons under Rules 73 to 91 of the Rules of Court. The two have a common purpose: the determination of all the assets and the payment of all the debts and liabilities of the insolvent corporation or the estate. The Liquidator and the administrator or executor are both charged with the assets for the benefit of the claimants. In both instances, the liability of the corporation and the estate is not disputed. The court's concern is with the declaration of creditors and their rights and the determination of their order of payment. Furthermore, as in the settlement of estates, multiple appeals are allowed in proceedings for liquidation of an insolvent corporation.